Canny homebuyers hold off house deals

Jun 6 2008 by Alex Turner, Liverpool Daily Post

HOUSEBUILDER Bellway has said “canny” Liverpool buyers are being cautious in a North West market that is being “particularly hard hit” by the housing market slowdown.

Bellway said the region, along with Yorkshire and the Midlands, was bearing the brunt of the tough market conditions.

In an interim management statement issued yesterday, the firm said overall reservations were down 31% on a year earlier, and that it had lowered its estimate for the fall in number of homes sold this year to between 10% and 15%, compared with 5% to 10% seen earlier this year.

In line with other housebuilders, Newcastle-based Bellway said the normal spring selling surge had failed to materialise. It reported a 9% fall in reservations in March, but has seen conditions deteriorate since then.

Alistair Leitch, Bellway’s financial director, said: “It’s not been the first hit for the North. The West Midlands was the first to go under, then it spread up to the north of the country.

“Liverpool, Manchester and Yorkshire were hit at the same time. Manchester was over-supplied while Liverpool people are just canny. They are deciding that this is not the right thing to do, but we are still selling houses in the Liverpool area.”

Bellway has a big development in Hunts Cross which has seen a slowdown in sales, although Mr Leitch did not wholly attribute this to the problems in the sector.

“It was a great site, but big sites have a time when they slow down,” he said.

And Bellway is looking to the banks to take the lead in improving the economic conditions before house sales can recover.

“Conditions will remain tough for as long as the banks aren’t speaking to each other,” he said.

“Things won’t improve until the oil goes back into the banks’ engine and there will then be a lag while customers’ confidence is restored. I don’t see any change until 2009.”

Bellway recently reported pre-tax profits of £96.9m in the six months to the end of January, against £100.8m the previous year. Its shares rose more than 5%, to close at 626.5p.

alex.turner